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CORRECTED-Asian groups vie for stake in southern Brazil railroad -paper
November 29, 2017 / 12:37 PM / 17 days ago

CORRECTED-Asian groups vie for stake in southern Brazil railroad -paper

(Corrects name of railroad in fourth paragraph)

SAO PAULO, Nov 29 (Reuters) - China Communications Construction Co Ltd and Japan’s Mitsubishi and Sumitomo Corp are vying for a stake in a railroad owned by Rumo SA, Brazilian newspaper O Estado de S. Paulo reported on Wednesday.

Railroad operator Rumo, which is controlled by energy and logistics group Cosan SA, hired the investment banking unit of Bank of America Corp to sell a stake in the Malha Sul system serving southern Brazil, the paper said, citing unidentified sources.

The Chinese company offered to inject 2 billion reais ($622 million) into the railroad and invest another 6 billion reais over a 10-year period, according to the paper.

Sale of the railroad stake is conditioned on renewal of Rumo’s concession for the 2,039-kilometer (1,267-mile) Malha Paulista, which expires in 2028, O Estado de S. Paulo reported.

The newspaper did not specify which company in the Mitsubishi Group had shown interest in the railroad. A representative for the Brazilian unit of Mitsubishi Corp said the company was not involved in any talks regarding Malha Sul.

Rumo, CCCC and Sumitomo did not immediately reply to requests for comment. Bank of America declined to comment.

$1 = 3.21 reais Reporting by Tatiana Bautzer and Ana Mano

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